New York Companies Slowly Putting More Women in Leadership

By Melissa J. Anderson (New York City)

This year, women hold almost sixteen percent of the director seats and executive positions in New York’s 100 largest public companies. Whether that’s good news or bad news depends on whom you ask.

The information comes as part of the Women’s Executive Circle of New York’s latest census of New York’s top companies, produced in conjunction with Columbia Business School. According to the study, the percentage of women in leadership roles at these companies is growing. Wonderful! But… that growth is occurring at what seems like a snail’s pace. How long will it be before a woman nabbing a top seat at a big company isn’t news?

Yesenia Scheker-Izquierdo, Co-President and Co-Founder of WECNY, and a partner with KPMG LLP’s New York Financial Services Practice, said, “We are seeing some progress but the pace is slow. The more information we can provide the more robust the conversation. We are fortunate that the information is well-received and that in general, diversity is a business focus that makes sense for all involved.”

Why Leadership Gender Diversity Matters

Many are starting to recognize the value of diversity in leadership. In fact, if there is any silver lining to the recent financial crisis, it has to be an increased discussion around gender diversity in leadership and corporate governance. Who can forget the oft-repeated notion, “What if Lehman Brothers had been Lehman Sisters?” which was explored in the insightful New York Magazine article on risk and gender on Wall Street.

Research has shown that not only do companies with more women in senior leadership make more money, but teams with more women tend to perform better as well. The reasons seem obvious.

First of all, when too many people of similar backgrounds get together, it turns out they can make some spectacularly bad – or at least ill-considered – decisions. Adding diversity to the mix can add enough friction to the decision-making process so that plans get mulled over and tested a bit more.

On top of that, women have been shown to be a little better at “social sensitivity” than men – they are more willing to listen to others. And when teams have more women, they collaborate better as a result.

Today we have plenty of firms paying lip-service to the business case for diversity. But how many are actually following through on commitments to increase the percentage of women in top roles?

Following Through on Dialogue

Obviously, increasing the number of women at the top isn’t as simple as firing half the men who are already there and replacing them with women – it’s an incremental process. And that process seems like an excruciatingly slow one. It can lead you to question whether some companies are really making a concerted effort toward improving gender diversity, or just hoping it somehow happens on its own.

According to WECNY’s research, when it comes to executive suites, the progress is particularly slow. When the organization first performed its census in 2006, women held only 12.8% of executive roles in New York’s biggest companies. In 2008, that percentage had dropped to 12%. Now it’s rebounded to 13.2% – an improvement, but not much.

When it comes to board seats, New York’s companies are doing slightly better. This year, 17.2% of board directors were women. That’s better than 2008, when only 15.5% of directors were women, and 2006, when the percentage was 14.7. This is progress, but it still means most companies only have one or two women at their board table. And, there are still fifteen companies on the list that have no female directors whatsoever.

WECNY hopes the report will raise awareness about the lack of women at the top, and encourage companies to come up with solutions.

Candace L. Quinn, Co-President and Co-Founder of WECNY and a shareholder in the Global Benefits & Compensation Practice of Greenberg Traurig LLP‘s New York office, said, “Our goal is to present facts that stimulate a dialogue that leads to viable solutions. Leadership in key roles gives women a greater voice and companies a diversity of experience and voices.”

Ann Bartel, Columbia Business School’s Merrill Lynch Professor of Workplace Transformation and Chair of the Economics Sub-Division, said we shouldn’t be discouraged by reports of slow progress.

“Many times even when we have disappointing results we can learn from these and help companies see what can be changed. These results can certainly provide guidance and vision,” she said.

The report provides a comprehensive overview of which companies have women at the top and which ones don’t, as well as changes in leadership demographics since 2006.